In a move not seen since the collapse of military rule, the leader of Greece's far-right Golden Dawn party has been jailed pending trial on charges that he used the organisation to operate a criminal gang that sowed terror on the streets of the country.

Emerging from Athens' court complex at 4.30am on Thursday to cries of "be strong chief", Nikos Michaloliakos was led away in handcuffs under armed guard to a Jeep that took him to the city's police headquarters. From there he will be transferred to prison, the first elected political head to be incarcerated in almost 40 years.

The politician, who denies the allegations, testified before an investigating magistrate for more than six hours. His wife, who is expected to replace him as head of the party, and his daughter, a senior Golden Dawn cadre, shouted words of encouragement as he was brought out ashen-faced.

In a statement released soon after, the neo-fascist party denounced the crackdown on the movement, which has seen its most prominent MPs rounded up and arrested.

"The most wretched plot in modern Greek history is currently under way against Golden Dawn," it said. "The detention of our general secretary is totally unjust, unconstitutional and has been dictated by foreign centres of power."

Michaloliakos was brought to Athens' court complex on Wednesday evening as followers cheered on the man accused of being the pre-eminent face of neo-nazism in Europe. "Blood, honour, Chrysi Avgi [Golden Dawn]," they screamed as the squat, grey-haired politician was led under armed guard into the building.

Michaloliakos had been expected to adopt the same stance as five other Golden Dawn MPs arrested on Saturday, arguing that he was the victim of political persecution. The 56-year-old mathematician is believed to have combed through a 4,000-page dossier drawn up by a supreme court prosecutor outlining Golden Dawn's alleged crimes over 20 years.

Charges include founding a political force that subscribes to the principles of Nazi ideology and actively indulges in widespread violence, targeting immigrants, minorities and political opponents.

Three of the four MPs arrested with Michaloliakos were released on Wednesday, pending trial. A fourth deputy, Yannis Lagos, was ordered to be kept in detention following charges that, like Michaloliakos, he was directly connected to the death of the Greek hip-hop star Pavlos Fyssas on 17 September in a working-class suburb of Athens.

The court also ordered Giorgos Patelis, the head of Golden Dawn's local office in the area west of Athens where Fyssas was stabbed, to be remanded in custody.

A sixth MP, Christos Pappas, who the prosecution has described as Michaloliakos's second in command, was to appear in court for his preliminary hearing later on Thursday morning.

Ilias Kasidiaris, the party's press officer, was freed on condition that he posted €50,000 (£42,000) in bail. All of the men were told they could not leave Greece.

Opposition politicians and lawyers voiced fears that, while executed with good intent, the charge sheet had been put together too quickly.

"This development shows that at least in the eyes of the court authorities the case was not substantiated enough," said Harris Ikonomopoulos, a prominent lawyer and publisher of the left-leaning daily Eleftherotypia. "It creates the perception that Greece is becoming a failed state where none of its institutions or the rule of law work."

Freed from custody, the Golden Dawn politicians showed their contempt for the media, shoving, kicking and spitting at photographers outside court. "Now you will see, you disgusting people," one deputy, Ilias Panagiotaros, said. "You will only stop us with bullets."

The extremists have been held responsible for hundreds of assaults in the 16 months since their 18 MPs were elected with 7% of the vote to the Athens parliament in June last year.

As the alleged mastermind of a criminal gang, Michaloliakos has also been linked to the murder of Fyssas, who rapped about the rise of racism in Greece.

The stabbing by a self-proclaimed member of Golden Dawn spurred Antonis Samaras's coalition government to take what officials are describing as the huge risk of launching the crackdown last weekend. From the US, where he is on an official trip, Samaras vowed to eradicate the evil of neo-Nazism, saying there was no place for it in any state.